$60 million IRS adjustment doesn't pay off for tax whistleblower
Tracking down tax records to file a disaster claim

Disaster help now, donation tax deduction later

Flooded homes_FEMA Facebook page1

The devastating Haitian earthquake. Deadly flooding in Tennessee and North Carolina. Tropical Storm Henri damage in the Northeast. Drought-fueled destructive wildfires in California.

Add the global Delta surge that's exacerbating the COVID-19 pandemic and it does seem, as my grandmother would say, that the world is going to hell in a handbasket.

If you've managed to avoid any or all of these disasters and want to help those who are less fortunate, thanks. Here are some ways to do so.

Myriad mechanisms to give: The standard big dog nonprofits, American Red Cross and the Salvation Army, remain the go-to donation sites.

You can give at the organizations' main websites, but I suggest you do a quick online search for your more local office. That helps your donations get to those in need more quickly.

For example, when I Googled "Tennessee flood recovery donations," one of the sites that popped up was the Tennessee Emergency Response Fund, which is part of the Community Foundation of Middle Tennessee.

Global giving options: Beyond U.S. borders, the Red Cross and Salvation Army can funnel donations to their international arms to help with Haiti relief efforts.

Doctors Without Borders, UNICEF USA, and Project Hope also are Internal Revenue Service-approved 501(c)(3) organizations that use U.S. dollars to help those in need worldwide. 

Want more? Charity Navigator has compiled a list of highly-rated charities providing relief and recovery efforts in the aftermath of the devastating 7.2 magnitude Haiti earthquake

U.S. operations like these that have global reach are important, from both an ease of giving and tax standpoint. There's more on the tax matters a bit later in this post, but the key consideration is that any gifts given directly to nonprofits in other countries are not tax deductible on U.S. tax returns.

However, when you instead give to a U.S.-based, IRS-authorized nonprofit that also distributes global assistance funds, then you can claim your gifts as a tax deduction even though you're helping non-U.S. individuals. My 2017 post on U.S. tax rules for international donation deductions has details.

Tax implications disaster donations: I say this every year, and despite how disheartened I am sometimes by too many horrific acts by my fellow humans, I still believe that most people are good. And many of those good people give because they want to help others.

That said, there's no reason to ignore how your good will can help you, too. If you can benefit from helping others at tax time, no one begrudges you getting some added thanks from the IRS.

Donations to qualified charities can be deducted. Take advantage of that tax break.

If you give a lot and itemize, all of your gifts listed on Schedule A count in helping reduce your income to a lower taxable level.

But for 2021 returns, there's a way for folks who don't itemize to claim a limited tax deduction directly on their Form 1040. Gifts totaling up to $300 for a single filer and up to $600 for married couples who file a joint tax return are entered as a direct deduction on your tax return.

Tax help for victims, too: As for all y'all who are dealing with disasters, I am so sorry. Having gone through a couple of hurricanes and the winter storm here in Texas back in February, I feel for you.

And I have a few tax tips for you, too.

If the event that's totally upended your life is one that's declared a major disaster, you should check into the possible of filing an itemized disaster tax claim. This help from Uncle Sam could be particularly helpful if you don't have much or any insurance to help you rebuild.

Also check with your local and state offices — here in the Lone Star State, for example, that's the Texas Division of Emergency Management and the Department of Agriculture — about funds and other assistance programs designated to help cover disaster losses.

Accept the assistance: Finally, if you do need charitable help to get through this rough patch, then take it.

There is nothing wrong with or to be ashamed of when it comes to accepting the kindness of strangers. Don't let false pride prevent you from getting whatever you need to get back to as near normal as possible.

You know if you were able to do the donating, you'd want those who needed your help to take it.

You also might find these items of interest:

 

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